Australia’s lowest variable interest rate reaches 2.17%

Variable home loan rates continue to drop with Freedom Lend today, the new leader in the mortgage rate wars, according to RateCity.com.au data.

The online lender is now offering a new record-low variable rate of 2.17 per cent, for new customers with a deposit of 30 per cent of more.

Home loan rates have continued to drop despite no official change to the cash rate.

Analysis of the RateCity.com.au data base shows his month alone, 15 lenders have cut more than 50 variable home loan rates for new customers.

RateCity.com.au research director Sally Tindall said, “The fight is on between the non-bank lenders to have the lowest variable rate in Australia.”

“Over the last couple of months, smaller providers have had to chip away at their rates in order stay ahead of the big banks."

“Just three months ago, the lowest variable rate was 2.44 per cent. Since then it has dropped 27 basis points."

“With the number of new home loans on the decline, lenders desperately need new business so they’re looking to refinancers to make up the difference."

“The recent increase in refinancing activity suggests rock bottom rates are prompting people to switch to take advantage of the relentless market competition,” she said.